Smith to Leave Sberbank CIB After Apology Over Rival’s Report

By Ksenia Galouchko and Jason Corcoran -
Jul 31, 2013

Andy Smith, Sberbank CIB’s head of equity research, said he is leaving the Russian investment bank after signing off on a corporate governance report using unattributed material from a competitor’s research note.

Sberbank CIB, the investment banking arm of Russia’s biggest lender, said in a July 26 statement that it had apologized for failing to give “appropriate referencing” to a 2012 research note by Moscow-based Aton Capital.

“As lead author of a recent research report, I take full responsibility for the content, conclusions and subsequent issues raised by this report,” Smith said in statement e-mailed by Sberbank CIB today. “In the interest of all parties involved, I have made the decision to step down.”

To fight plagiarism in Russia, Prime Minister Dmitry Medvedev appointed Igor Fedyukin, then deputy education minister, in March to try to stamp out the practice of awarding unmerited doctorates to politicians and businessmen. A commission headed by Fedyukin, who has since stepped down, discovered “a fake thesis factory” at a Moscow college.

In 2006, President Vladimir Putin faced scrutiny over a degree he’d received about a decade earlier from the St. Petersburg State Mining Institute when researchers at the Brookings Institution said that 16 pages were reproduced almost verbatim from a study by two University of Pittsburgh professors. Putin hasn’t publicly addressed the claims.

Presentation Pulled

Sberbank CIB pulled its presentation of the research note to investors in the U.S. after Finparty.ru published the accusations last week, Vedomosti reported on July 26. An intern may have copied part of the Aton report, two people with knowledge of the matter said, asking not to be identified because of the sensitivity of the issue.

Along with Smith, who had joined state-controlled Sberbank in March of last year, the report lists chief strategist Kingsmill Bond and analysts Andrey Kuznetsov and Iskander Abdullaev as authors on the report. Abdullaev declined to comment, while Bond and Kuznetsov didn’t reply to e-mails or calls to their office phones seeking comment.

Paolo Zaniboni, the London-based head of the investment research department, will take managerial responsibility for the equity research team until further notice, according to Sberbank’s statement.

Sberbank Investment Research was named Russia’s leading brokerage in June in the 2013 Thomson Reuters Extel survey after its analysts topped the rankings in nine categories. The research team was also voted Russia’s best in Institutional Investor’s 2013 ranking, the bank said. Smith won best head of research in Europe, Middle East and Africa from Sammons Associates, a London executive-search company.

State-controlled OAO Sberbank, which holds just less than 50 percent of the nation’s deposits, acquired Troika Dialog brokerage group in January 2011 for an initial $1 billion. Troika, Russia’s oldest brokerage, was rebranded Sberbank CIB last year.